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WazirX Funds Are Suspended Due to Alleged Money Laundering

WazirX Funds Are Suspended Due to Alleged Money Laundering

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ED takes steps to investigate money laundering claims related to crypto exchange WazirX.

India’s Enforcement Directorate (ED), India’s economic crime-fighting agency, has froze all WazirX funds due to their money laundering investigation.

By opinion shared on August 5, ED suspects that the company has helped “fintech companies backed by Chinese funds” to buy various crypto-assets and “launder them abroad”.

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These fintech companies have not received permission from the Reserved Bank of India (RBI) to conduct lending operations in the country. That’s probably why they used WazirX to circumvent Indian authorities.

Indian authorities have allowed the freezing of WaziriX bank accounts, which includes 646.7 million rupees (about $8.1 million).

According to the Indian authorities, so was the director of the company, Sameer Mhatre multiple opportunities to provide ED with detailed information event history. However, decided to ignore it.

ED states that it has given WaziriX offers countless opportunities to provide information on crypto transactions involving fintech companies and “expose KYC of wallets”.

The enforcement agency argued that:

WazirX cannot account for missing crypto resources. It has not attempted to trace these crypto assets. By encouraging obscurity and enforcing lax AML norms, it has actively assisted some 16 accused fintech companies in laundering the proceeds of crime through the crypto route.

However, on August 7, the company announced on Twitter that operations had not been interrupted and everything is working normally.

A document released by the Economic Crime Agency of India has also stated that WazirX has links with Binance, one of the largest crypto exchanges. ED claims that Binance is one of the owners of Zanmai Labs Pvt Ltd, which owns WazirX..

Binance CEO Changpeng Zhao took to Twitter to dispute these claims, saying that “Binance does not own equity in Zanmai Labs, the entity that operates WazirX and was founded by the original founders.”

One of the founders of WazirX Nischal Shardeum has also used Twitter state that “Binance Acquires WazirX” and that the company “operates crypto to crypto pairs, handles crypto removal…”.

Continued Argument It took until August 6th between Zhao and Shardeum.

Gile K. - cryptanalyst

by Gile K. – Crypto Analyst, BitDegree

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